Vandana RamnaniMoneycontrol News
A resident sits in front of a block of state-funded flats for slum dwellers previously living in low-lying, flood-prone areas in the western Indian city of Surat November 24, 2009. Just next to India's west coast, Surat is learning to live with big upheavals and now wants to become a front-runner in preparing for the impact of climate change in a country with fast-rising emissions but generally low environmental awareness. Picture taken November 24, 2009. To match feature INDIA-CLIMATE/ADAPTATION REUTERS/Arko Datta (INDIA ENVIRONMENT SOCIETY) - GM1E5C814LI01
Homebuyers wanting to buy property falling under any part of a development authority and planning area, including rural areas, industrial belts and even rural pockets within special economic zones (SEZs), have reasons to cheer. They can now avail the benefit of around Rs 2.3 lakh to buy a house under the Prime Minister Awas Yojana (PMAY Urban) as the guidelines of the scheme have now been modified.
These changes have been made following complaints that some banks were not approving loan applications under the interest subsidy scheme in certain areas in urban and rural localities. In the past, several banks had turned down applications under the credit-linked subsidy scheme (CLSS) for properties in about 100 cities and towns, including Noida.
The amended guidelines state that all areas “falling within notified planning/development area under the jurisdiction of an industrial development authority/special area development authority/urban development authority or any such authority under state legislation which is entrusted with the functions of urban planning and regulations shall also be included for the coverage under PMAY(U).”
The earlier guidelines had excluded rural areas. “States/union territories will have the flexibility to include the planning area (to the exclusion of rural areas) as notified by the development authorities,” the earlier guidelines had said.
“Rural areas, industrial belts and rural pockets within special economic zones (SEZs) have now been included under the amended guidelines,” say sources in the ministry.
The beneficiaries in the permanent wait list of PMAY (G) will now have the flexibility of opting for a house under PMAY(G) or PMAY (U), as per the amended guidelines.
The beneficiaries in the permanent wait list of PMAY (G) will have the flexibility for opting for a house under PMAY (G) or PMAY (U), the guidelines say, adding the benefits of all existing and future rural schemes will not be denied to a beneficiary covered by the above definition solely on the grounds that he has availed of a house under PMAY (U).
Under the amended guidelines, all statutory towns as per Census 2011 and towns notified subsequently including notified planning/development areas will be eligible for coverage under the Mission.
In the existing guidelines, only statutory towns under Census 2011 and towns notified by the state governments were eligible for coverage under PMAY. There are more than 4,000 such towns in the census.
Banks were hesitant to provide a subsidy for towns that are not listed among the 4,300 towns. “There was confusion with regard to which towns are covered because of which financial institutions were not pushing loans from these locations as the onus of correct data lies with the financial institution and if during audit it is found that the town is not covered under the list, the onus of recovering the money is in the institution. Therefore, they were consciously not going beyond the 4,000 locations,” says a banker.
Confusion over which towns are covered under the PMAY scheme was one of the primary reasons, besides the cap on the size of units, that the credit linked subsidy scheme (CLSS) did not kick off.
Under the PMAY scheme launched on January 1 this year, the central government gives an interest subsidy of 4 percent for loans up to Rs 9 lakh for those having household income up to Rs 12 lakh, and an interest subsidy of 3 percent for loans up to Rs 12 lakh for those with household income up to Rs 18 lakh. The scheme also provides for an interest subvention of 6.5 percent on loan of up to Rs 6 lakh for homebuyers in the economically weaker section and low-income group earning less than Rs 6 lakh a year. The entire benefit is given upfront to a buyer.
Until a few months ago, the limitation of the carpet area was acting as a disincentive with several buyers and builders saying that it was an artificial limit. Last week, the government increased the carpet area under MIG-I from 90 square metre up to 120 square metre and carpet area in case of MIG 2 from 110 square metre to 150 square metre, both effective January 1, 2017. The subsidy of up to Rs 2.30 lakh on home loans under the middle-income group category 2 and Rs 2.35 lakh for MIG 1 will now be available until March 2019.Vandana.firstname.lastname@example.org